Turkey’s Savunma Sanayii Başkanliği (SSB) denies that Law 7161, effective since January 17th, provides obligors with a way out of their offset commitments. “Their denial, from a legal perspective, is not reasonable,” a lawyer told us. “It is not possible to say it does not cover offset agreements”.

Ukraine, which has an increasing need for defence materiel, has introduced legislation to make offsets mandatory for defence procurements. Ukraine used to require foreign OEMs to engage in assembly and parts production on an ad hoc basis.

Australian defence minister Christopher Pyne has warned Australian companies wishing to benefit from industrial participation not to charge unfairly high prices. “Our defence industry doesn’t have a green light for gouging the taxpayer,” he told companies that had failed to win contracts. “We’re not interested in building people’s second beach houses.”

Dumitru Costin, leader of Romania’s National Trade Union Bloc, has criticised the lack of offsets applied to Romanian defence procurements. He complained that according to contracts agreed with foreign prime contractors, offset investments worth around €750m have been pledged, but none have so far been executed.